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Saturday, July 21, 2012

Extending Melky Cabrera

One of the hardest questions as a Giants fan is do you want to offer Melky Carbrera a long term contact. If so, how high would you be willing to go?

Complicating the matter is the fact that he has two distinct periods in career, on e in which he has produced at a below average rate and one at an above average rate. Prior to his 2011 stint with the Royals, he was a prospect who didn’t live to his hype and was a tweener in the outfield. From 2011 to this year, he has hit like gangbusters and has played at the worst an average corner outfield defense.

That brings up the question when you considering a long term deal: Which is the real Cabrera?

Is it the guy that failed to live up to the expectations placed upon him? Or the guy that blew past previous hype and is now a certified All-Star?

Luckily, we have a few ways to look at things when forming out opinions on long term contracts. The first is the always there when you need it Oliver from the Hardball Times (which is provided by @SFBleacherGirl because I decided paying for daycare was more important than a projection system) that provides six year projections. In addition I will use more simplistic models that assume 0.5 decay in WAR production, along the same lines a 10% WAR decay per year model. And, last but not least, I will look at what the ten players that Baseball-Reference said were his most similar players through age 27 did over these years.

The 0.5 decay and 10 percent decay are pretty straight forward and only change based on the assumed WAR of the starting year for which I used 4 WAR, his total last season.

The Baseball-Reference list is the simple average of the WAR that each player produced. His most similar players produced at a nearly league average rate until about age 31 and then suffered pretty large declines with each passing year. This seems to be a pretty fair approximation, although I would hope that Cabrera could be a bit better in the first couple years of the deal.

Looking at a rough average of all four would give you something like this: 3, 2.5, 2, 2, 1.5, 1, and 1. I think that this is a very good ball park for what to expect going forward. This seems like a good middle of the road guess that I feel comfortable using going forward.

The next step is looking at what a win will be valued at. This is kind of a crude method, but it works pretty good to give a general ball park of what the market rate is for free agents. Right now, a win is worth approximately $5 million on the open market. For this, we will look at three different inflation scenarios over the next few years.

Years 10% 7% 5%
3 $45.16 $42.83 $41.31
4 $59.80 $55.93 $53.47
5 $71.88 $66.45 $63.04
6 $80.74 $73.96 $69.74
7 $90.48 $81.99 $76.78
At shorter term deals, there isn’t really that much difference. When you go longer, however, you start to see some divergence. With how his comparable players aged, I would feel uncomfortable with the Giants going long term. It seems that the Giants have gotten a bit more selective in their long term deals over the last few years.

The range that I would love to see would be the three to four year even, so long as it came with a higher average annual value that would push the deal to $45 to $55 million. It would also give Cabrera the chance to sign one more significant contract as a free agent after either his age 30 or 31 season after proving his last couple season weren’t fluky.

That would be ideal but when dealing with free agents things often don’t work out so nicely.

The deal that is talked about as one Cabrera is looking as a model is Andre Ethier, who recently signed a five-year $85 million deal. Even under the best assumptions, such a deal looks to be a bad bargain for the Giants and if some team is willing to go to that level, the Giants will probably lose him. It will be sad to see him go, but the Giants will be smart to let some other team take on the risk with a deal that has little upside.